On Friday, JPMorgan lifted its sell rating on Tesla, which it had maintained since July 2023, now categorizing the stock as 'neutral.' Analyst Rajat Gupta emphasized the importance of Tesla's vertically integrated supply chain and its artificial intelligence initiatives, particularly the crossover between its automotive and robotics divisions.
He noted that utilizing production facilities for testing AI products like Optimus could reduce costs and validate these technologies on an industrial scale. This upgrade comes as Tesla prepares for the initial public offering of SpaceX, another of Elon Musk's ventures, which is expected to be one of the largest IPOs in history, targeting a valuation of $1.8 trillion.
The upcoming IPO has prompted Wall Street firms and major stock indexes to reassess their strategies regarding Tesla and SpaceX. While S&P Dow Jones Indices has decided against changing its entry requirements for major indices, Nasdaq and FTSE Russell have made adjustments to facilitate quicker index entry for large companies.
Additionally, there is speculation about a potential merger between SpaceX and Tesla, which could create a combined company valued at $3.5 trillion, according to Ray Wang, CEO of Constellation Research